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Odds for Targeted Medicare Tweaks Appear Tougher After Omnibus

By Kerry Young, CQ Roll Call

December 17, 2015 -- The odds grew tougher this week for groups seeking to make quick and targeted changes in federal health payment rules, including modifications to a new policy regarding hospital outpatient services.

The fiscal 2016 omnibus (HR 2029) emerged after weeks of negotiations relatively free of both controversial riders and the kind of add-on provisions that Congress can use to tweak the complex Centers for Medicare and Medicaid Services (CMS) regulations through larger bills. 

Republicans and Democrats scuttled bids to fight through the $1.15 trillion spending package over topics such as abortion and research on gun violence. Also pushed aside were many calls from medical groups, both in and outside of Congress, for changes to CMS rules and policies.

Looking at the legislative landscape for next year, there may be few significant bills moving that could carry these kinds of add-on CMS provisions, said Elizabeth Carpenter, a vice president at the consulting firm Avalere Health. Enactment of an overhaul (PL 114-10) of Medicare's physician payments this year ended a long cycle in which slated cuts in Medicare reimbursement for doctors had triggered routine action in Congress. But, repeated "doc fix' bills had provided handy vehicles for smaller changes to CMS policy, she said. At the same time, the looming 2016 election will disrupt legislation, with members distracted by election work.

"It's interesting to think about what will Republicans make priorities in an election year, and what could be natural vehicles for health care items," Carpenter said. 

In the Senate, Health, Education, Labor and Pensions Chairman Lamar Alexander, R-Tenn., is working on a biomedical research bill that could be a companion to the House's so-called 21st Century Cures package and change Food and Drug Administration policy to help speed the introduction of new medicines. In the House, Ways and Means Chairman Kevin Brady, R-Texas, has said he would like to proceed with an overhaul of hospital payments. It's unclear yet how far these efforts will go, and whether any other major authorizing measures will emerge that could carry with them relatively small changes to Medicare payment policies, Carpenter said.

Congress has in recent years had a poor record for handling appropriations during election years, leading to a reliance of stopgap spending packages. The nature of the must-pass appropriations bills has raised a high bar on ride-along provisions and shut off another avenue for changing CMS policy.

Still, groups such as the Federation of American Hospitals (FAH) will be on the hunt for legislative vehicles. A priority for the FAH is changing the terms of a congressional plan to meant to end to curtail hospitals' acquisitions of private medical practices, said Jeff Cohen, chief lobbyist for FAH, which represents chains including Tenet, HCA, and HealthSouth. A strong effort to include this in the omnibus fell short.

"We found there was a tremendous amount of support from both Democrats and Republicans in the House and Senate," Cohen said. "We are going to continue to work with our friends on Capitol Hill."

Lawmakers surprised observers by using planned savings from a provision affecting hospital outpatient department payments as an offset in the October budget deal (PL 114-74). The Medicare Payment Advisory Commission (MedPAC) for some time, though, has been raising the discrepancy in payments for identical services when provided in a hospital outpatient department, as opposed to a private practice. An echocardiogram done in an independent doctor's office, for example, might cost $188, while the charges for one done in a hospital-affiliated doctor's office could be $452.89, MedPAC said in one report.

The Congressional Budget Office has estimated that as much as $9.3 billion may be saved over a decade through the provision in the debt deal that limits higher Medicare hospital outpatient payments largely to the existing network of off-campus department. What FAH is seeking to broaden the terms for outpatient departments that can continue to collect this higher payments to include those where expansion plans were well developed with the budget deal took effect.

Another issue that may continue into next year is the push for an easier path to exemption from penalties for missing a federal electronic health records deadline.

CMS now can provide this relief on a case-by-case basis, said Bob Doherty, the senior vice president for government affairs and public policy at the American College of Physicians. There had been an effort as well to get broader relief for doctors and hospitals through the omnibus.

"The fix that we were hoping that we would get in the legislation would have provided a blanket exemption for physicians" who missed the deadline due to a delay with the finalization of regulations, he said.

A blanket exemption provision was included in a small package of tweaks to health policy that appeared at least briefly to be on the legislative fast track this week. This was in the House amendment to Sen. Isakson's electronic health fairness bill (S 1347), which is on the Rules Committee's list of possible suspender bills for the week. But there has been no further action yet on the measure, and it's unclear whether the House and Senate could clear this measure in the remaining legislative days of 2015.

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